The blog on BBC Radio
on June 1, 2013

UK consumerMay13.pngSlowly but surely the world’s media are starting to follow the demographic story, and how it relates to today’s ongoing economic crisis. Thus the blog was interviewed by BBC Radio’s flagship current affairs programme, The World Tonight on Thursday (it begins at 10:20 mins).

The interview was part of a special series looking at why the UK economy was failing to show many signs of growth, despite £bns of stimulus and low interest rates.

The blog discussed the chart above, noting:

• Household expenditure is 60% of GDP in the UK and elsewhere (and as high as 71% in the US). It thus dominates the economy, and cannot be replaced by other items
• People’s spending drops past 50 as the kids leave home and they move towards retirement
• Household spend thus drops from £30k (€35k, $45k) at the age of 50 years to just £20k by 65
• Already 28% of the UK population are in their low-spending years. And 2100 BabyBoomers are due to retire every day between now and 2030

We therefore need to recognise that Western economies have gone ex-growth. And we should instead be celebrating the fact that people are living so much longer, for the first time in history.

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